By MARTIN CRUTSINGER, AP Economic Editor
WASHINGTON (AP) – US Treasury Secretary Janet Yellen has said she will lead efforts by key US regulators to assess the potential risk climate change poses to the US financial system, as part of a broad initiative launched by the Biden administration.
Yellen said the regulatory review, which will be carried out by the Financial Stability Supervisory Board, will examine whether banks and other lending institutions correctly assess risks to financial stability. She chairs the committee, which includes the Treasury, Federal Reserve, Securities and Exchange Commission, and other financial regulators.
“The current financial system does not produce reliable disclosures,” Yellen said in remarks prepared for the Venice International Climate Conference and released in Washington.
As part of President Joe Biden’s whole-of-government approach, Yellen said, the board will consider what should be done to improve current regulations on climate-related financial disclosures.
The council was established by Congress in 2010 to improve regulatory coordination in the aftermath of the 2008 financial crisis.
Bank executives fear that the administration’s efforts will lead to increased regulatory oversight, which would increase the cost of doing business for banks and reduce their ability to make loans.
Yellen said the United States also intends to enlist support from the International Monetary Fund, the World Bank and other multilateral development banks to focus more resources on tackling climate change. The World Bank and regional development banks are the main sources of loans used by poor countries for dams and other development projects.
“Developing countries are particularly vulnerable to climate change, with poverty, food security and health being impacted by extreme weather shocks,” Yellen said.
She said the administration supports international efforts to mobilize $ 100 billion a year from various public and private sources to support developing countries’ efforts to tackle climate change.
Yellen said she plans to convene a meeting of heads of international lending institutions to discuss ways to better align their efforts with the Paris climate agreement. The Trump administration withdrew the United States from the Paris climate agreement, but Biden reversed that decision after taking office this year.
Since taking office as Secretary of the Treasury, Yellen has been one of the administration’s main voices in spurring government efforts to tackle climate change.
The administration is also making a big push to include huge investments to slow global warming in the multibillion-dollar infrastructure spending measures that Biden is pushing Congress to approve. That effort met with opposition from Republicans with various Biden climate initiatives removed from a bipartisan infrastructure measure.
Environmentalists say a larger, all-Democratic package that is being crafted must meet Biden’s ambitious climate promises, such as shifting the country to carbon-free power generation and becoming a world leader in the use of electric vehicles and the creation of millions of jobs. in the solar, wind and other clean energy sectors.
The Venice international climate conference on Sunday followed a meeting of finance officials from the Group of 20 major economies in Venice on Saturday. This group has supported a radical overhaul of international taxation that includes an overall minimum corporate tax of 15% to deter large corporations from seeking low-rate tax havens.
The measure is expected to be a key agenda item when Biden and other G-20 leaders meet for a summit in Rome on October 30 and 31.
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